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PLAN OBJECTIVES
- To build up a sum of money which will be used to provide a tax-free cash sum when you retire and a regular income for the rest of your life, in order to supplement the state pension.
- To help your retirement planning cope with changes in your personal and financial circumstances.
- To invest in the MSV Life With Profits Fund
- To provide a cash sum to your wife, husband or dependant(s) should you die before retirement.
YOUR COMMITMENT
- To make regular contributions for the life of the Plan.
- To keep the Plan invested until you choose to take your retirement benefits.
- To invest for the long term and to review your contributions on a regular basis.
ABOUT THE PLAN
- The MSV Personal Pension Plan (With Profits) is a long term regular savings pension plan investing in the MSV With Profits Fund
- It allows you to save on a regular basis and to invest additional lump sums at any time in the future.
- Contibutions to the Plan qualify for a tax credit for those meeting the eligibility criteria below.
RISK FACTORS
What you get back will depend on our investment performance and the bonuses we add. Future bonuses are not guaranteed. The value of your pension plan will be less than illustrated if the bonuses declared are lower than illustrated.
- If you transfer your Plan early you may receive less than the Policy Account. This will happen either as a result of transfer charges in the early years or if we are forced to apply a Market Value Reduction (MVR). An MVR may be applied if the value of our investments falls suddenly.
- The returns you get on With-Profits investments depend on a number of factors including
- The return on investments in our underlying With-Profits Fund
- The way we distribute any profits on the fund
- Factors beyond our control, such as tax and the effect of inflation
- Profits and / or losses from non-participating plans (other than unit-linked plans) which are also part of the With-Profits Fund
- The cost of meeting any guarantees that we provide.
- The rate of future bonuses cannot be guaranteed and may also change over the years.
- Inflation will reduce the real future value of any cash sum.
- When you retire the fund value may be less than illustrated if:
- You stop contributing into the Plan, or reduce contributions
- Investment performance is lower than illustrated
- You take your benefits earlier than your selected retirement date
- Tax rules change
- Charges increase above those illustrated
Plan pay-in flexibility
Paying In
- You save on a regular basis and you can make single ‘one off’ top ups whenever you like.
- Contributions to the Plan can be made by cash, cheque, standing order or bank transfer.
- You can increase your regular contributions whenever you like, or choose to have them automatically increased each year in line with inflation (minimum 3.5%).
- You can change your contributions in the future to suit your personal circumstances.
Stopping contributions
You can stop making contributions, in which case:
- Your Plan will continue to be invested
- We will continue to deduct our charges, which may reduce the value of your Plan. When you retire your benefits are likely to be less than you expected.
Restarting contributions
- Within five years of stopping contributions you can restart them at no additional cost, subject to the minimum terms applicable at that time.
- If you do not restart your regular contributions within 5 years of stopping them we will automatically change the status of the Plan to Paid Up, meaning that no further contributions may be made into it. At retirement you will still be able to access the benefits.
Who can have one?
The Plan is available to anyone aged between 18 and 65 and has a minimum term of 10 years. Personal Pension Plans can only be issued on a single life basis and cannot be pledged or assigned.
Tax credit is only available to those meeting the eligibility criteria.
- How much can I pay in?
There are no limits to the amount you can contribute, but you should ensure any contributions you agree to are affordable now and for the foreseeable future.
It is not recommended that you save more than the maximum allowed for the tax credit. Should you wish to save more than this amount it might be more beneficial to put the extra amount into an alternative savings plan.
The minimum contributions are: - €40 per month
- €120 per quarter
- €240 half yearly
- €480 annually
The minimum single top up to the policy is €150.
Where and how is my money invested?
After deducting the Plan charges, we invest your money in our With-Profits Fund.
- Our With-Profits Fund is invested in a range of investments including shares, bonds, property and short-term assets. The mix of these assets is determined by us with the objective of maximising the rate of return whilst preserving the real capital value of the investments.
- The MSV Simple Guide to With Profits is available for more information and can be obtained through our website at
www.msvlife.com.
How is the growth of my Plan determined?
- When you invest in our With-Profits Fund, you share in the potential profits of MSV in the form of Bonuses.
- The value of your Plan grows through the addition of Regular Bonuses. A Regular Bonus is calculated as a percentage of the Policy Account and is added to the Policy Account on a daily basis. We guarantee that when a Regular Bonus is added to your Plan it is “locked” and cannot be taken away if you hold the Plan until it matures.
- In addition, we may also add a Final Bonus upon payment of the Maturity Benefit or the Death Benefit.
- The bonuses will depend on factors such as investment performance, charges and other profits or losses made by our with-profits fund.
- The main aim in determining bonuses is to smooth out the ups and downs of the stock market. The process of smoothing leads to returns that are steadier than if they fully reflected the underlying value of the assets of the With-Profits Fund.
- We may apply a Market Value Reduction if you transfer your Plan or decide to take your benefits before your selected retirement date which will reduce the amount payable. This can happen when there has been a large or lengthy fall in stock markets or when investment returns have been consistently lower than expected.
How will I know how my Plan is performing?
We will provide you with a free statement once a year, or upon request. In addition you should have regular reviews with your financial adviser.
What happens to the Plan if I die before I retire?
- If you die before taking benefits we will pay 101% of the value of your Policy to your estate or named beneficiary.
- Advanced pre-payment of death benefits is available to cover funeral expenses, up to a maximum of €2,500 or the value of the Plan if lower.
What happens if I need the money early?
Saving for retirement is a long term commitment and you should not commit any money which you might need to access before retirement. Current legislation only allows you to start taking benefits between age 50 and 75.
What are the Plan charges?
Policy Fee - €30 yearly
Top Up Allocation Charges
- A percentage deduction from the Top Up premium paid will be made varying between 1 and 3%.
All charges are subject to review from time to time, however we will give you 90 days notice before making any alterations.
Market Value Reduction
If you transfer your Plan before its maturity date or decide to take benefits before your selected retirement date, we retain the right to effect a MVR which will reduce the amount payable. The MVR cannot be applied:
- upon maturity of the Plan
- in the event of the payment of the Death Benefit.
This reduction is designed to protect investors who remain invested and its application means that you get a fair share of the With-Profits Fund in which your savings are invested.
Can I change my mind?
- After your Application Form has been accepted, you have 30 days from the policy issue date to cancel the Policy and obtain a refund of your contributions.
- If you cancel the Policy during this period you will not be liable to any charges imposed by us. However any adverse market movement in the value of the investments shall be at your risk.
- A request to cancel must be received in writing by us.
How do I claim the tax credit?
MSV Life will notify the Inland Revenue that you have made contributions to a Personal Pension Plan.
If you are not required to complete an annual self-assessment tax return then you do not need to do anything. The Inland Revenue will simply issue you with a tax refund of 15% of your contribution.
If you normally complete a self-assessment tax return then you will be required to state your contribution on the form and the tax computation will take it into account.
Tax refunds normally start to be paid by October following the year of your contribution. If you have any queries regarding the payment of your tax credit it is recommended you speak directly to the Inland Revenue Department.